XAVIER MAS DE XAXÀS, 27/12/2020
Bradford believes that Europe “sets the rules of the global economy and shapes the world according to its values”.
Anu Bradford, expert in international trade at Columbia Law School Columbia University (Columbia Law School)
Last January, Anu Bradford, professor at Columbia Law School (New York), published the essay The Brussels Effect. How the European Union rules the World (Oxford University Press). The Brussels Effect. How the European Union rules the World (Oxford University Press). The central idea is that “the EU has the ability to set the rules of the world economy”. True, it does not have an army or a unified diplomatic position, but in her view, it has something far more important, the world’s largest single market, and it is thanks to it that it imposes changes in many countries that benefit hundreds of millions of people.
Bradford wrote her essay before the pandemic and we wanted to ask her whether, one year later, this global leadership has been maintained or not. The interview was conducted by video conference, and we have edited it to make it easier to read.
Has Covid-19 damaged the EU’s global influence?
Quite the opposite. Covid-19 has increased the EU’s power in the world. The pandemic has not killed globalisation as many experts predicted. Companies remain committed to global markets. Although they are adapting their production chains, they have not retreated into their home markets.
And how does this benefit the EU?
Because as long as companies want to produce and sell their products on a global scale, there will be a trend towards regulatory uniformity. It is very clear that international companies adopt European regulation because it is the strictest and opens up the most markets. The EU thus sets the rules of the global economy and shapes the world according to its values.
You speak of a technocratic power that determines how a car is made in Korea, how forests are cut down in Indonesia, how crops are grown in Nebraska and how big tech companies are run.
Yes, and that is why the Brussels effect is so resilient to political setbacks. Even if there is a major health crisis, even if there is an economic crisis hitting the core of the EU, bureaucrats still sit at their desks every day to produce regulations that apply around the world. In the last few days, for example, major regulations on the digital market have been announced.
The pandemic has not slowed down the Brussels regulatory machinery.
No. The machinery has continued to work because it has its own dynamics. Note that during the pandemic the EU’s regulatory power, its management capacity, has not diminished; quite the contrary. Contrary to what might have seemed, the states have not regained competences. On the contrary. The Union’s powers are growing.
The pandemic is an opportunity to move towards more integration.
The recovery fund is a clear example. It will rescue economies in exchange for certain policies.
What will we see next?
The integration of public health. There are signs that the EU is moving towards a health union.
“The EU is moving towards a health union.
Brexit will shrink the single market, which you identify as the main source of European power in the world.
I regret Brexit very much. It is true that it will be very costly for the EU, but it will be even more costly for the UK. The EU loses a great advocate of the single market, and it also loses regulatory capacity because the contribution of the British has been considerable. But Brexit will not harm the Brussels effect, it will be the Brussels effect that will harm Brexit.
British business depends on access to the single market. It accounts for more than 45% of their exports. To access it they will have to continue to comply with Brussels rules.
Regulatory sovereignty is an illusion.
Yes, the UK will have to take on board EU regulations without being able to influence their wording. It has lost power over the regulations that will shape its economy. Countries that are in favour of more regulation, such as France and Germany, will have more leeway to impose their criteria.
“Brexit will not hurt the ‘Brussels effect’, it will be the ‘Brussels effect’ that will hurt Brexit”.
In addition to Europe, China also has a great regulatory capacity. It is trying to impose its criteria on the 5G network on many European countries.
True, and it worries me a lot. This year we have seen a very clear trend from China to impose its interests in the digital economy, but it will take more time for the Brussels effect to be replaced by the Beijing effect. China is not able to spread its regulations around the world as the EU does.
It is building 5G networks that imply a great deal of leverage.
Bradford worries that China will export its regulations and authoritarianism through 5G networks.
Yes, I am concerned that China could export its rules through 5G infrastructures. While the European vision for regulating the digital economy is very much focused on the individual, with very clear democratic values, the Chinese vision is authoritarian, and the Chinese companies building these infrastructures are linked to the Chinese Communist Party.
These companies, such as Huawei, have good clients in Europe.
There is growing scepticism towards Huawei but there is work to be done. There are states with very strong ties to China, which detracts from the coherence of the EU’s position. A clearer common position is needed.
China also has good allies in international bodies.
It is very adept at exporting its standards through bodies such as the International Telecommunications Union, where the EU and the US do not have as much influence.
How should the US and the EU respond to this challenge?
They have to work together, and I think with Joe Biden it will be easier because he is a true Atlanticist. You share Europe’s concern about China’s digital authoritarianism.
China offers digital technology to many developing countries.
Because the US and the EU have not offered them an alternative. They should do so. Tell them that China does not have to build its technological infrastructures. They can rely on Washington’s technological capacity and Brussels’ regulatory capacity not to depend on China.
The US and China have a strong power to impose their interests that the EU lacks.
I think the concept of strong power is confusing. I understand that it is talked about in the current geopolitical context, but it is very difficult to put into practice. The EU is not and will not be a military power. It is not even a geopolitical power. Trying to use the Brussels effect for geopolitical purposes will not work.
The pandemic has highlighted the need for the EU to acquire more autonomy in strategic sectors.
Agreed, but this strategic autonomy should not be for the EU to have its own army but to develop its own capabilities, investing in artificial intelligence, in research and development.
The EU often seems to doubt its own capabilities.
It should shake off this complex but also be aware that it can do much more. It should complete integration into a digital single market to fulfill its full potential. And it should also have a single capital market to finance European technology companies. The EU needs as robust a single market as possible because that is the source of its power in the world.
It seems that only a minority of Europeans today advocate moving towards further integration.
We should not seek integration at any price. It is true that further integration is not always the solution, but there are areas where integration is justifiable. The pandemic has taught us that it is impossible for a country to be truly sovereign. Cooperation is more necessary than ever. Where integration is of clear benefit to member states, progress must be made: public health, digital space, capital markets and fiscal union.
The rhetoric of sovereignty is very strong in several European capitals.
There is a lack of courage among some national politicians. They blame Brussels even though Brussels is not to blame for anything, and they take credit for Brussels. I wish they would be more honest enough to tell their citizens that the EU has made them safer and richer, that it has protected them as consumers. The list of benefits is very long, and specific, and national leaders should have the courage to say so.
“Europe does not have enough people to overcome the demographic crisis. Immigration is part of the solution.
Populism has put the brakes on immigration. How does the lack of a common migration policy harm the EU?
Have you ever wondered why Europe doesn’t have companies like Google, Amazon, and Facebook? It doesn’t have them because it over-regulates them. It does not have them because it does not have a single capital market to facilitate their financing and because it is not able to attract talent, unlike the United States. Steve Jobs, founder of Apple, is the son of a Syrian immigrant. Jeff Bezos of Amazon is a second-generation Cuban immigrant. Serguei Brin, the founder of Google, is Russian. The EU must boost its economy with more immigration. It does not have enough people to overcome the demographic crisis. Immigration is part of the solution.
More immigration and more integration, a formula for success in 2021.
Next year will be difficult because recovery will take longer. But the EU has a great future. It has shown great unity in the face of Brexit and has found good solutions that take Europe to a better place. The EU, for example, should not be content to be the regulator of the digital economy but should aspire to play a dominant role.